Amy and Goliath

Above all, Goldberg argues that reduction of pharmaceutical profits will result in diminished research and, in the end, fewer lifesaving drugs coming onto the market. "This populism is simply a U.S. domestic political effort to suck profits out of the pharmaceutical companies by reducing worldwide price through eliminating intellectual property protection," he says. "In the short term, it sucks profits; in the long term it will result in a reduction in research funding as we saw with tuberculosis and malaria drugs when the original patents expired."

His argument is echoed by conservative (and HIV-positive) journalist Andrew Sullivan. In an October essay in the New York Times Magazine, Sullivan wrote, "It would be wonderful if we could make the newest drugs affordable for anyone who needs them and keep the lifesaving research going. But cut prices and you cut profits. Cut profits and you cut research and development. Cut research and you slow new drug innovation. You may get cheaper and more widely available drugs in the short term, but you'll also get worse drugs in the long term, and risk ending the greatest era in research in memory. Don't big pharmaceuticals make enough money to take a hit? Sure, their profitability is slightly higher than some other industries -- but that barely offsets the unique risks the drug industry has to take. Of more than 5,000 potential medicines tested at some point in the lab, on average only 3 get into clinical trials, and only 1 is approved for patient use. In all, only 30 percent of drugs make enough money to recoup the cost of their own research, and the average time it took to bring a new drug to market in the 1990s was close to 15 years, at an average cost, according to Boston Consulting Group, of $500 million."

New York University professor Merrill Goozner challenges these assertions. In an online debate with Sullivan on Slate, Goozner, who covered the drug industry for the Chicago Tribune for years, described the claim that the industry spends $500 million to bring a new drug to market as "preposterous."

"This bogus number is based on an industry-funded study that assumes all industry research is relevant and all its new drugs are clinically important," Goozner wrote. "Nothing could be further from the truth. Much industry research is aimed at bolstering marketing claims for its existing products. And nearly half is aimed at developing minor variations of existing drugs. Indeed, one of the authors of the original study has corroborated my own estimate that in excess of 40 percent of industry R&D is aimed at producing such 'me-too' drugs." Besides, Goozner argued, a significant chunk of industry research is funded by the U.S. government. "The National Institutes of Health will spend $2.3 billion in AIDS-related research next year. PHRMA, the industry trade group, proudly claims its members have 73 AIDS drugs in development and then quietly admits that most firms are receiving substantial government aid (usually through collaboration with NIH-funded researchers) as they try to move them from the laboratory to the marketplace."

According to Goozner, the bottom line isn't about whether pharmaceutical companies should be run as for-profit endeavors. "It's the size of the rewards that are being questioned. And when it comes to lifesaving drugs whose price puts them beyond many people's grasp even here in the good ol' USA, that's a question whose answer should be based on facts."

Kapczynski denies that distribution of AIDS drugs in Africa will be as chaotic and disorganized as critics like Goldberg claim. "No one is offering to dump anything out of airplanes. This is a tired red herring," she says. "There are serious discussions going on at the moment in the U.N. and elsewhere about bulk procurement and distribution systems for AIDS drugs to ensure that they get to the people who need them."

As for the arguments that the pharmaceuticals won't be able to do R&D and produce new drugs if they can't maintain current profit levels, her response boils down to "Show me the money."

"It may be true that the American people will now start to demand an honest accounting of the way prices are set in this country," she says. "If drug companies were willing to open their books and discuss how much they actually spend on the development of particular drugs, we could start to make reasoned decisions about how to value the work they do. And it may be that they need to rethink how they organize research -- we might start, for example, by addressing the fact that pharmaceutical companies spend two to three times as much on marketing as they do on research."

The fight, it is clear, has only just begun.

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